Prior to June 30, a company has never had any treasury stock transactions. A company repurchased 100 shares of its $1 par common stock on June 30 for $40 per share. On July 20, it reissued 50 of these shares at $46 per share. On August 1, it reissued 20 of the shares at $38 per share. What is the journal entry necessary to record the reissuance of treasury stock on August 1 using the cost method?
A)Debit Common Stock $760; credit Cash $760.
B)Debit Cash $760; debit Paid-in Capital, Treasury Stock $40; credit Treasury Stock $800.
C)Debit Common Stock $800; credit Treasury Stock $760; credit Paid-In Capital, Treasury Stock $40.
D)Debit Cash $760; debit Common Stock $40; credit Treasury Stock $800.
E)Debit Cash $760; credit Treasury Stock $760.

Question

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The Answer of Prior to June 30, a company has never had any treasury stock transactions. A company repurchased 100 shares of its $1 par common stock on June 30 for $40 per share. On July 20, it reissued 50 of these shares at $46 per share. On August 1, it reissued 20 of the shares at $38 per share. What is the journal entry necessary to record the reissuance of treasury stock on August 1 using the cost method?
A)Debit Common Stock $760; credit Cash $760.
B)Debit Cash $760; debit Paid-in Capital, Treasury Stock $40; credit Treasury Stock $800.
C)Debit Common Stock $800; credit Treasury Stock $760; credit Paid-In Capital, Treasury Stock $40.
D)Debit Cash $760; debit Common Stock $40; credit Treasury Stock $800.
E)Debit Cash $760; credit Treasury Stock $760.

Prior to June 30, a Company Has Never Had Any